Google Ads: How Paid Search Can Revolutionise Your Business

Monique Anderson, 
Head of Search, 

Welcome to the largest, most widely used online advertising network in the world.

Google Ads (known as Google AdWords until July 24th, 2018) is the online advertising platform developed, owned and operated by Google. It allows advertisers to display brief advertisements, product listings, video content and service offerings.

Google receives 70,000 search queries every second. What’s more, the majority of Google search engine results pages (SERPs) contain advertisements. This makes Google an extremely effective way of driving qualified and relevant traffic to your website.

It’s little surprise that Google Ads has evolved into the multinational tech behemoth’s primary source of revenue. As of June 2018, Google derives a staggering 86% of its total revenue from trading advertising inventory.

Millions of companies across the globe advertise online using Google Ads in order to reach new customers, enhance their brand identity and grow their business. They do this by targeting users across two networks: the Search Network and the Display Network.

The Google Search Network sees advertisers bid on those keywords that are both relevant to their businesses and that have a chance to display their ads to users who enter those keywords into Google as part of a search query. This is known as pay-per-click (PPC) advertising, or paid search.

A Google Ad appears at the top of the SERP and looks very much like an organic result (i.e., one that is the result of unpaid advertising). The primary difference is that a Google Ad has a small green Ad label.

Paid search means there’s no need for advertisers to wait for their brand new website to work its way organically up the rankings. Using paid search gets you immediate results. It’s cost-effective, impactful and relatively straightforward to implement in your ad campaign!

The Google Display Network gives advertisers the opportunity to place banner-style ads on any website that is part of the Display Network, an extensive collection of third-party websites that have partnered with Google and agreed to serve Google Ads to users. The Display Network reaches approximately 90% of global internet users. Digital marketers harbour genuine concerns about banner blindness, the phenomenon of users becoming ‘blind’ to banner ads as a result of desensitivity to their ubiquity, but you can still get creative to get around this, by using a range of media such as images, gifs, even videos.

One of the most pernicious misconceptions about Google Ads is that the biggest budget always wins outright. It’s this belief that’s stopping many small businesses from trying Google Ads, even though doing so could actually benefit them hugely. Whilst a bigger budget never hurt, Google Ads is a much more level playing field than many advertisers and marketers realise.

How does Google Ads work?

Choose your keywords. Create the ad. Let the cashflow commence. Next!

…Okay, so there’s a little more to it than that. Let’s break this down.

A Google Ad is primarily grounded in its keywords. An advertiser decides which keywords to target based on what is being typed in by those individuals to whom they wish to market. Of course, there are probably other companies who’ve hatched the same cunning plan and are, right this moment, placing their own bids on those very same keywords. Sneaky.

There’s more to it than just keywords, though. Audience data is now robust and all-encompassing that you can understand every aspect of a user’s life from their online activity, be it their marital status, number of kids, job, postcode, inside leg measurement, name of their first goldfish and in what order they add the jam and cream to their scones (cream first, obviously). It’s the combination of all of these data signals that Google uses to really understand just what the ideal prospect for your business looks like.

If you want your ad to appear on Google, you are required by Google Ads to bid against rival marketers for the prime real estate of the top paid search spots on the SERP. The more you pay per click, the likelier it is your ad will appear on the SERP. It’s supply and demand 101. The more individuals who enter the bidding, the more scope there is for the cost to increase.

However, unlike other real-time bidding models, it isn’t just the highest bid that’s accounted for when determining how high your ad appears.

Ad Rank

In order to determine where on the SERP your ad appears — or indeed if it’s shown at all — Google assigns every ad an Ad Rank. Your Ad Rank is determined by the maximum bid you’re willing to pay per click multiplied by your ad’s Quality Score (more on that later). Generally speaking, the ad with the highest Ad Rank attains top position on the SERP, the ad with the second-highest score gets the second spot and so forth.

Google assesses 5 quality components of your ad in order to assign it an Ad Rank.

Bid

When you set your bid, you’re essentially informing Google Ads of the maximum you’re willing to pay for every click on your ad. That being said, you’ll actually end up paying less than that most of the time. Moreover, you can change your bid whenever you like.

Search context

When calculating your Ad Rank, Google considers a multitude of factors besides the actual search terms entered by the user.

  • Is the user searching on a desktop or mobile?
  • What was their location at the time of the search?
  • What time of day was it?
  • What other ads and search results showed on the page?

Clearly, the success of your ad campaign is contingent on numerous variables. The keywords are only one of them.

Thresholds

Google set minimum requirements that an ad must achieve if the advertiser wishes the ad to show in a certain position. This is Google’s way of assuring that ads of only the highest quality are shown to users, as low-quality ads would not only reflect badly on the advertiser but on Google themselves, as they would be the ones opting to display them.

Quality Score (QS)

How relevant to a user who has typed in a targeted keyword are your ad and the website to which it links? Google assigns every ad a QS, which you can monitor and work to improve. Google heavily penalises advertisers who bid with ads that have low QS.

Estimated impact from ad extensions

You can add additional information to your ad, such as contact details or further links to specific pages on your site. These are called ad extensions, and their estimated impact on your ad’s performance is taken into account by Google Ads.

A better ad means a better Ad Rank

Whenever a user enters a search query that triggers your ad, an updated Ad Rank is calculated. The calculation incorporates not only your bid but also your ad’s Quality Score, which itself is directly impacted by 3 key factors.

  • Expected click-through rate (CTR). This is based partly on your ad’s historical clicks and impressions (adjusting for factors such as extensions, ad positions and formats that may have affected the visibility of an ad on which someone previously clicked).
  • Ad relevance. To what extent is your ad helpful, useful or salient to the search query entered by the user?
  • Landing page quality. How relevant, easily navigable and transparent is the page that your ad links to?

By improving on these factors, you increase your ad’s Quality Score and thereby attain a higher Ad Rank.

Why does ad quality matter?

Higher-quality ads generally lead to better positions, lower costs and greater ROI. They also receive more exposure, getting displayed more frequently and in better positions on SERPs. This enables you to receive more clicks and conversions without having to increase your bid.

The abovementioned 5 quality components of Ad Rank can affect your ad in several ways.

  • Position. The better Google deems your ad to be, the higher up it will appear on the SERP.
  • Cost per click (CPC). A higher-quality ad often leads to a lower CPC, meaning the advertiser has the privilege of shelling out less money on advertising.
  • Auction eligibility. Google’s measure of ad quality determines the Ad Rank thresholds for your ad. By doing this, Google deems whether your ad is worthy of appearing in the auction.

The Google Ads system works optimally for everyone, whether customers, publishers, advertisers or Google themselves, when ads are extremely relevant to users and are of the highest possible quality.

Bidding

Every time your ad is clicked, you pay Google. The price you’re willing to pay for every individual click is your ad’s CPC. You can opt for a maximum bid amount or allow Google to automatically calculate the bid that is optimal for your budget and that should theoretically bring in the most clicks for that budget. A third, less common, option is cost-per-impression (CPM), in which you pay Google for every 1,000 appearances of your ad on the SERP — regardless of whether users click through or not.

Every time a user enters a search query into Google, the search engine

  • considers every relevant advertiser for that search term
  • decides whether an auction is a required course of action, and runs it if it is
  • calculates which ad offers the best combination of highest maximum bid and QS

Then and only then is an ad shown on the SERP. This all takes place in roughly 0.26 seconds.

Google Ads auctions run billions of times per month. This allows web users to find ads that are extremely relevant to what they’re searching for. Moreover, the sheer volume of auctions means advertisers are able to connect with potential customers at the lowest possible price, with Google all the while raking in billions of dollars of revenue.

With revenue in mind, let’s dive into the nuts and bolts of your Google Ads financing.

How much does a Google Ad cost?

As you might have expected, there is no one-size-fits-all answer to this question.

Many newcomers to pay-per-click (PPC) advertising have no expert guidance and spend their ad budget much more quickly than they had anticipated, perhaps a whole month’s worth in a matter of days. This can lead to them falling into the misconception that PPC is prohibitively expensive — but this is generally not true. More often than not, it’s pure misunderstanding of budgeting that leads to this situation, not exorbitant pricing.

PPC: the basics of budgeting

Ah, the B-word. Enough to strike fear into even the hardiest of advertisers.

However, once you’ve got to grips with PPC budgeting, you’ll see that the principles really are relatively straightforward. Certainly, at its heart, the PPC budget is much the same as any other budget. You start with a core figure which represents the majority of your ad budget, then allow for some leeway in case something changes or goes wrong.

Every one of your ads should have its own daily budget, no matter how many you’re running at once. You can control the parameters of each independently of the others. It’s also worth thinking about which campaigns take priority if you’re running several simultaneously.

Let’s say you’re running a campaign advertising your best-selling product. This is probably more important to your business than is another campaign promoting content to prospects who are still at the top of your sales funnel. In working out which campaigns are most crucial to the success of your business’s advertising, you take the first step towards calculating how much budget to allocate to each campaign.

How is a daily PPC budget spent?

Let’s dive right in with a hypothetical campaign.

Let’s imagine you have an ad with a CPC of £0.50. Bear in mind that your CPC is the maximum you will be charged per click, but you might actually pay less, contingent on the variables of the auction.

You would like your ad to receive 500 clicks per day. Your estimated daily budget for this ad would be

£0.50 × 500 = £250.

So far, so good.

However, there are a number of factors you may need to consider that can impact your PPC budget — and therefore the success of your ads.

Dayparting

Dayparting, also known as ad scheduling, allows you to specify when you want your ad to appear to prospects. It is common amongst businesses with physical locations to which they wish to drive customers.

Let’s say you run a bakery which closes at 5.30 pm. You might want your Google Ad to show more frequently (or even solely) during business hours. You may instead choose to run your ads throughout the day, but with a greater proportion of your daily budget allocated to certain times.

Device Targeting

The days of prospects searching exclusively from desktop browsers have long since passed. Today, consumers search the web from a multitude of devices, so you have to pay attention to where your most valuable leads are coming from.

Let’s say you wish to appear on results across both mobile and desktop searches — but mobile traffic is of overall greater value to you. Device targeting allows you to allocate a greater proportion of your marketing budget to those ads that appear on mobile devices. Now let’s say that you’d noticed that your product was actually particularly popular amongst Android users. Depending on your ad copy or what you’re actually advertising, you may actually opt to allocate more budget to specific types of mobile device.

Geotargeting

Geotargeting can be a highly effective way of capitalising on growing mobile traffic trends and on-the-go shopping habits of consumers. In much the same way as you can allocate a greater proportion of your budget to specific times of day, geotargeting allows you to allocate more money to searches coming from users in certain geographical areas. You might choose to geotarget an area the size of an entire county — or an area with a 5-mile radius from your business.

What other costs are involved in PPC?

Your advertising budget will always be the largest and most direct cost associated with your PPC campaigns, but there are other potential costs to consider, depending on your marketing goals, your business and your individual situation.

Management software

Google Ads offers advertisers a high degree of control over the precise variables of their accounts, and it can be extremely powerful in the right hands. However, some business owners opt to use PPC management software rather than manage their accounts manually, because it can reduce costly errors, saves time and lets them get on with the day-to-day running of the company.

PPC management software is typically licensed rather than purchased. This means that using it to automate and manage the legwork of your Google Ads accounts entails you factoring in subscription costs to your outgoings.

Agency costs

Some businesses choose to have an agency handle their PPC work. In hiring a PPC agency, you not only minimise your personal time investment but also bring on board individuals with years of digital marketing experience under their belts. Furthermore, most channel partner agencies have exclusive access to beta scripts, as well as new testing from Google. This means that finding the right PPC agency means finding a trustworthy partner, whose expert guidance and advice can keep you ahead of the game.

How much does a typical click cost?

In 2016, the average CPC on Google Ads (or Google AdWords, as it was then known) in the UK was £0.99. However, there is significant variation behind this figure because, when it comes to highly competitive markets, clicks can become really rather pricey.

A useful analogy for PPC advertising is actually traditional print advertising. Consider the enormous gap in cost you’d expect when comparing the price of placing a classified in your local paper to having a full-page advertisement in a glossy national magazine. When it comes to digital marketing, the difference isn’t so much the format of the ad as it is the commercial intent of, and competition for, the keywords on which you’re bidding.

Long-tail keywords: the unsung heroes of PPC

Keywords vary significantly in their price depending on the competitiveness of their respective digital marketplace. This is a concept you need to get to grips with before beginning your PPC campaign.

Let’s say you’re bidding on the keyword black trainers. There could be literally tens of advertisers competing for this. However, if you target a highly specific long-tail keyword, such as black running shoes for high arches and there is search volume for it, it’s less likely you’ll run into competition.

What are some of the most expensive keywords?

To give you an idea of what you might be up against, let’s take a look at the top 20 most costly keywords in the UK.

Keyword

CPC

casino£58.57
online gambling£25.45
finance£13.76
money transfer£12.38
insurance£11.94
business services£11.68
internet£11.27
advertising£10.45
vehicle tracking£10.26
elderly health£9.94
estate agents£9.68
video production£9.41
locksmith£9.14
health£8.85
fitness£8.72
charity£8.59
financial trading£8.5
education£7.74
racking£7.47
loans£7.39

 

The finance industry, in particular, can afford such pricey CPCs because the average lifetime value of a customer is so high.

Some marketers will point to these keywords as definitive proof that CPC is exorbitantly expensive — but that’s far from the whole story. These keywords are highly competitive, yes, but they constitute only a small proportion of total search volume. The vast majority of web searches are long-tail keywords.

Find the prospects who want what you sell

Let’s say you’re a company that sells board games. You’re probably going to struggle to appear near the top of an organic search with a keyword as competitive as board games, especially if you’re a startup or small business. But what if you specialise in vintage wooden parlour games? Well, if you home in on that keyword, your user pool will be small — but you will find those consumers who are seeking precisely what you’re selling.

Long-tail keywords are lengthier and more specific phrases (vintage wooden parlour games) that stem from or qualify short-tail keywords (board games), also known as head terms because they drive high quantities of traffic. Web users are likelier to use long-tail keywords when they’re closer to the point of purchase.

Managing long-tail keywords is simply a matter of establishing more effective lines of communication between your business and the customers who are already out there and looking for what you’re selling. After all, someone searching for games is unlikely to click through to your niche website, but someone entering the search query 1920s oak chess set? They are almost certainly searching for something so specific because they have purchase intent.

Long-tail keywords will draw in far less traffic, yes — but that traffic will be more focused, more salient and more committed to the services you provide. With savvy implementation, your ROI will be proportionally much greater than if you were competing to rank for head terms.

Less competition? Less spend

Long-tail keywords are valuable to businesses who want their content to rank organically — but sometimes even more valuable for those running paid search marketing campaigns. This is because long-tail keywords’ specificity makes them inherently less competitive, which in turn leads to a lower CPC.

The trick is to find a renewable — and reliable — source of long-tail keywords that are right for the niche you’ve carved out. By targeting highly specific long-tail keywords in your Google Ads campaigns, you can achieve consistently higher ad rankings on relevant searches without paying a premium for every click.

Why you should invest in paid search

There are never any guarantees in the world of digital marketing. The success of your Google Ads campaign is highly contingent on 1) the competitiveness of the keywords you’re bidding on and 2) the relevance of those keywords to real conversions for your business.

That being said, you can be safe in the knowledge that Google Ads is an extremely effective tool for businesses in every industry — as long as its implementation is well informed and the strategy behind it is solid. A 2016 study by Ofcom found that only 49% of adults could reliably identify sponsored search results as being advertisements. This means many users show no preference for organic results over ads in their online behaviour — great news for businesses utilising paid search.

Google Ads is cost-effective

Nothing’s free in this life — but that doesn’t mean there aren’t some seriously sweet deals out there to be had by those in the know.

When an advertiser starts out, they might not necessarily divide up their marketing budget as efficiently as they could. A bad experience with Google Ads early on in the campaign sometimes turns business owners off from the platform altogether. Remember, though, that all marketing channels cost. It’s finding out whether or not you’re seeing a good ROI on that cost that should dictate whether or not you stick with it.

Some marketers leave their accounts to run on autopilot. Sometimes the person managing the account isn’t qualified to be doing so. The money will generally be lost in these circumstances. But apart from hiring a professional PPC agency, there are other steps you can take to ensure you’re getting more bang for your buck.

Learn how to use it

As simple as it sounds, the number one reason businesses waste money on Google Ads is simply because they don’t take the time beforehand to learn the ins and outs of the platform. Google Ads is accessible to, and comprehensible for, anyone — if they put in the groundwork first. It takes some quality study time and a healthy amount of trial and error. Spend time reading about it, watch instructional videos, become a walking glossary of the jargon.

Set a realistic budget and bidding strategy

Just determining your ad campaigns’ budgets and bids can feel like a full-time role, but there’s no need to overcomplicate the process. Start by mapping out what you can be feasibly spending per campaign, then set your daily budget accordingly. Do bear in mind, though, that you can sometimes end up spending as much as double your daily budget. Furthermore, bid manually to begin with. This will let you gain the learnings and insights you need before considering any automation. This gives you maximum control over your accounts. There’s no need to let Google run the entire show for you!

Track spend

There’s a multitude of reasons that your spend might be getting out of control. Perhaps you’re using automated bidding which is rapidly depleting your budget. Maybe your keywords are triggering irrelevant — and therefore costly — clicks. The takeaway messages are to always be active in reviewing your KPIs, check in on your spend on a daily basis and remember that you may sometimes end up spending as much as double your daily budget.

PPC isn’t mutually exclusive from SEO!

A surprisingly large proportion of business owners and marketers are under the illusion that having a great SEO strategy negates the need for paid search. In fact, the exact opposite is true! When expertly implemented, PPC effectively complements SEO and boosts overall profitability.

If you want to target new keywords organically, it can take a long time for your content to rank — but PPC allows you to do so right away and determine whether they’re going to be profitable, and therefore worthwhile.

SEO is not 100% reliable, no matter how good the experts implementing it — there are far too many extraneous variables that can unpredictably alter the digital environment. You can follow best practices to the letter and still not see top organic rankings. With PPC, however, the rankings of your ads are entirely in your hands.

The real winning formula in digital marketing is taking your site and content, giving it the full SEO makeover, then implementing an effective paid search strategy. As Thomas Stern, SVP of Clients Services at ZOG Digital, says,

As a paid-search marketer, you’ll be able to identify all the long-tailed queries for which organic is earning great performance, then enhance your bid strategies accordingly.

So why aren’t my Google Ads leading to conversions?

In 2013, eBay faced a dilemma.

Their ads were not leading to anywhere near the desired level of conversions. They would go on to make the bold assertion that Google Ads fundamentally doesn’t work — then promptly received much backlash from business owners and marketers. In actual fact, their ads simply weren’t very good.

The issue raised by eBay, though, was at least sincere. Some businesses really do struggle with paid search not leading to conversions and feel totally helpless. Why might this happen?

Misuse of dynamic keyword insertion (DKI)

In the case of eBay, they seemed to have run a huge number of words through Google Ads’ DKI, a function that allows you to insert a query searched for on Google into your ad in order to make it as relevant as possible, thereby increasing click opportunity. This can be hugely effective if done knowledgeably, but eBay bid on irrelevant keywords then used them with DKI.

Poorly structured account

Advertisers often don’t see conversions because their accounts are just not being well managed. Maybe they’re not using negative keywords to block irrelevant searches, leading to accounts chock-a-block with unrelated terms. Perhaps they’re targeting keywords that are irrelevant or too broad. A well-structured account provides a steadfast foundation for achieving tangible and excellent results with paid search.

You aren’t remarketing

You can’t always rely solely on search to gain conversions. This is especially true of B2B companies. The easiest and most effective additional tactic is to remarket. Cookie your site visitors and follow them around the web with offers pertinent to their needs. Keep yourself in their periphery; ensure they’re constantly reminded of your existence. It’s integral that you reinforce your brand and spell out to potential customers why they need your services or products.

Your ads just aren’t relevant

It might sound obvious, but sometimes you just need to take a step back, survey the situation and remember: your keywords must match your ads — and your ads must match your landing pages. Just one bounce off your page because of an irrelevant ad is can be frustrating enough to a user as to turn them away from your brand and perceive your company as inept. To avoid this, don’t group together large sets of keywords that direct to a specific ad not directly related to the keywords searched for. This is a surefire way of diminishing conversion rate!

Low-quality landing pages

It can be hard to hear, but sometimes you just need to be told: this landing page is not good enough. If accepting this involves a little deconstructing of the ego then so be it. Regardless of how long it took to design, to craft, to write, if you’re not receiving leads  then something’s gone awry. Don’t be afraid to run A/B tests to try out variations of your page. The results might just surprise you!

Google Ads saves you time

This one is the most straightforward of all. Paid search can certainly seem time-intensive, and sometimes it is — but, in the long run, it’s worth it. Dedicate however much time it takes to effectively evaluate, track and tweak your campaigns. Google are improving their automated strategies on a monthly basis. If you put in the legwork right at the start of your campaigns, it will pay you dividends in the long run.

TLDR? 10 steps to using Google Ads

It’s time to take a step back and assess what we’ve learned.

It’s always good to recap when you’re taking in a lot of new information, and if you want to implement a more effective PPC strategy then you might well have to elucidate your newly gained wisdom to other members of your team at some point. As Einstein said (God I sound clever), If you can’t explain it to a six-year-old, you don’t understand it yourself.

Let’s break down the basics, from start to finish. What does an expertly implemented PPC strategy look like?

1. Establish your goals

Why are you using Google Ads? What do you aim to get out of it? Is it to increase lead generation? E-commerce? Brand building? The way you structure your account and the features that you take advantage of will hinge on your approach to this initial, and fundamental, question.

2. Determine your audience

Who are your ideal customers? What are their demographics, their interests, their jobs? Whereabouts do they live? What time of day are they searching most intensively? What device are they conducting most of their searches on?

3. Keyword research

By bidding on those keywords that are pertinent to your company and what you’re selling, you can place your ads on the SERPs of those users who are seeking what you offer. Keyword tools can help you discover your competition, what your costs are likely to be and what kind of volumes the search terms have.

4. Set your budgets and your bids

Okay, so now you know which keywords are right for you. Time to get your calculator out! If the average CPC is looking too high, consider getting granular. You’ll probably see a decrease in volume — but this should be matched by lowered costs! Remember to spend the bulk of your advertising budget on those keywords that convert at a high rate, although always leave a little on the side for testing and brand building.

5. Structure your account

Your account consists of campaigns, each with its own distinct goals. Every campaign needs to be targeting only a handful of highly salient keywords and exceptionally relevant ads.

6. Write superb ad copy

In order to maximise click-through rate, you need to ensure every section of text contains compelling headlines, a bold call-to-action and masses of the keywords you’re bidding on. Tell a story. Ads with an emotive narrative receive way more clicks!

7. Design amazing landing pages

This is where the action goes down. This is where people who have clicked on your ad convert — or don’t. Your landing page needs to be bright, engaging and utterly to-the-point, as well as designed with both desktop and mobile in mind. It needs to focus not just on features but also on how the prospect will benefit from the product or service. The call-to-action needs to be extremely visible throughout the page.

8. Implement conversion tracking

Conversion tracking allows you to measure your ad’s performance with regards to its KPIs. You can tag your site or app with a conversion tracking code from Google Ads, meaning a temporary cookie is placed on a user’s device when they click on your ad. You can then either utilise Google Ads or Google Analytics to create conversion goals!

9. Grow your remarketing lists

It’s imperative that you build your remarketing lists as early in your ad’s campaign as possible. This will allow you to keep your service or product in front of prospects even if they don’t convert on their initial visit to your site.

10. Routine optimisation

Marketing waits for no man! The realm of digital advertising is ever-changing. It’s crucial you stay ahead of the game by consistently optimising your campaigns. How do you do this? By testing everything! A/B-test your landing pages and ad copy. Add negative keywords to eliminate unqualified search queries. Adjust your bids based on keyword performance.

Or… let the experts take care of it

Push are a multi-award-winning digital marketing agency based in London, and the only Google Premier Partner to have won a Google Award 3 years in a row. We work with mid-tier businesses and startups who are looking to grow — and grow fast.

Push are passionate about helping businesses grow by getting seen by huge online audiences and expertly implementing the latest innovations from Google. We have a relentless focus on speed and making sure that user experience on our clients’ websites is perfect.

Push’s PPC management services utilise our very own Google Ads scripts, of which we have developed over 100 in-house to date. These allow our clients to automate tasks and gain greater insight into the analytics behind each and every ad campaign. We deliver exceptional results on a number of platforms because we implement our PPC solutions efficiently and effectively — keeping our clients ahead of the game. And don’t just take our word for it! Check out some of our amazing work.

Push are highly esteemed leaders in the realm of digital marketing. We are, quite simply, the best PPC management agency in the business. Get in touch today and find out from one of our friendly team how we can revolutionise your business, boost your conversions and increase your turnover!